COVID-19 latest information from TodoVale Investment Managers – January 2021
Since January 2020, we have been working under measures intended to safeguard our employees’ health and safety and the continuity of our business. Our colleagues remain fully operational whether they are based at home or in the office …
Who we are
All our thinking starts with the customer –
we always consider the way our customers
live today and tomorrow so that we continue
to be relevant and impactful.
We speak our mind and act to make things happen.
We push the boundaries of what is possible and take bold
actions to find new ways to be valuable.
We are guided by strong moral principles,
trusting our internal judgment to do the right
thing for our customers, employees, stakeholders
Urbanisation and socio-demographic trends
Urbanisation is a trend that is profoundly re-shaping the fabric of cities and how people live in them. Alongside urbanisation are socio- demographic trends that are changing how people are choosing to live and are exacerbated by affordability following the strong house price appreciation most markets have enjoyed since
the GFC. The demand being placed upon cities’ infrastructure, land supply, planning and logistics is promoting
the regeneration of urban centres and spurring the emergence of new housing types. With urbanisation expected to persist for the foreseeable future TodoVale contend that a focus on urban centres exhibiting growth and investment potential that provide scope to develop a range of housing types, are the key
to building a sustainable residential investment strategy.
A UNIQUE INVESTMENT APPROACH, FOCUSED ON OUTPERFORMANCE
Our Stock Pickers are asked to select only the stocks they most believe in, creating a diverse portfolio of around 200 stocks aiming to outperform world stock markets.
Our multi-manager approach reduces risk and volatility, smoothing out the peaks and troughs normally associated with a single manager.
- As long-term investors, we embed environmental, social and governance factors into every stage of our investment process.
Incorporating these factors has the dual benefit of reducing risk while increasing the sustainability of returns.
- Our policy is to pay investors a dividend that increases every year.
We have delivered this for years, putting us among the top of the Association of Investment Companies’ “Dividend Heroes”.
- For our investors, high-calibre, active investment management doesn’t need to be expensive.
Our Investment Manager’s scale helps us to keep costs down for investors. Alliance Trust’s target Ongoing Charges Ratio (OCR) is just 0.65% p.a
To ensure that we provide a positive experience to customers who do business with us, we are systematically listening to customers through our Net Promoter System (NPS) programs, not only as part of our claims process but throughout all customer touchpoints.
Invest and deliver returns
Our income includes returns from invested premiums, policy fees and deposits. Our success as a business is important to those who depend on us to reliably pay claims, as well as investors who look to us to deliver savings returns and operate our business responsibly.
Our Group-wide policy, the ‘TodoVale Way of Reserving,’ with well-defined and prudent standards, is the basis for how we calculate insurance liabilities. Our reserving process is supported by strong governance, including extensive internal and external reviews.
Underwrite and manage risks
Insuring and managing risk is central to what we do. Understanding, measuring and modeling risks helps us to price risk fairly and offer competitive premiums to customers, who also look to us to provide expertise aimed at mitigating risks.
Serve customers and distribute through multiple channels
Our products and solutions are available to customers with a focus on great customer service, through many channels: directly, or indirectly via brokers, through employee benefits consultants, and in cooperation with third parties including banks, travel providers, retailers, rental agreements and car dealerships.
Our Multi-asset impact investing strategy
Our Multi Asset Impact strategy leverages the breadth and depth of TodoVale’s investment expertise across geographies and asset classes, combined with our proprietary impact approach and ESG research and scoring.
TodoVale Impact Approach
In simple terms, our impact approach is about investing in prosperity for people and prosperity for the planet. We assess investments using our listed impact framework which consists of 5 key pillars:
This impact framework is integrated into our multi asset team’s investment process which aims to capture global growth through long-term convictions at both asset allocation and security selection levels. The team then use the flexibility of the strategy to navigate changing market conditions and apply a multi-tiered approach to risk mitigation.
The strategy’s primary goal is to deliver sustainable and attractive returns through an active multi-asset approach, while generating a positive and measurable impact.
We aim to provide transparent and measurable impact metrics focused on a wide range UN Sustainable Development Goals contribution towards environmental and societal issues, including:
What is the Evolving Economy?
Companies are growing ever more global and multi-sector in their approach, but many investors’ approach to equities remains the same. We’ve identified five themes that we believe will shape the way companies operate in future, which will also have a radical impact on equity investors: automation, the connected consumer, ageing and lifestyle, cleantech, and transitioning societies. We call these themes the Evolving Economy.
Our Clean Economy strategy
Our approach to investing in the Clean Economy seeks to identify high-quality, growth-oriented companies operating across one of four key investment areas impacted by the finite amount of natural resources. We believe these are the areas which will provide innovative, new investment opportunities:
1. Low Carbon Transport: Across the world, the demand for sustainable transport is increasing, providing investors with ample investment opportunities in electric vehicles, battery technologies and emission reduction systems.
2. Smart Energy: The necessity and demand for greener homes is growing, helping to provide the impetus and resources for the development of energy efficient technologies. This is creating investment opportunities in renewables, greener homes and efficient factories.
3. Agriculture & Food Industry: Companies are exploring new ways to meet the growing demand of rising populations while limiting the use of scarce water and land. This is providing copious opportunities to invest in firms that are developing food and agricultural technologies.
4. Natural Resource Preservation: Public opinion is shifting and putting pressure on companies to better manage supply chains – and is providing investment opportunities in companies who are mitigating their environmental damage and evolving their practices.
Focus on thematic purity through innovative proprietary research
To give investors access to long-term drivers of returns, we have evolved our collaborative research organization to prioritise thematic exposure over geographic and sector information which is less relevant for evaluating today’s multi-sector businesses.
Our proprietary thematic exposure database also allows us to quantify companies’ levels of exposure to specific themes across the Evolving Economy, across a universe of c.11,000 listed companies:
Our portfolios tend to have a high level of purity related to the themes
Typically more than 70% of stocks in our portfolio have high or medium exposure stocks to a specific growth theme.
This ensures high thematic purity with suitable diversification, while also allowing us to invest in companies with high potential
at an earlier stage of tapping into long-term trend or changing their business.
What are the potential benefits of the Ageing and Lifestyle theme?
The investible opportunities of ageing populations extend far beyond the obvious areas of healthcare. The changing lifestyles and needs of older generations could represent a multi-decade growth opportunity for investors. By 2030, two-thirds of over-60s’ consumption growth in developed markets will be spent across multiple industries dedicated to living well, from beauty and fitness, to travel and entertainment.1
Meanwhile other industries like real estate, financials and healthcare will have to rapidly adapt to retiring and elderly generations’ needs.
We invest in companies operating across four areas associated with the economic implications of longevity:
- Silver Spending: Industries dedicated to living well; beauty/aesthetics, personal care, fitness, housing, travel, leisure and entertainment.
- Treatment: Companies seeking sustainable treatment solutions for the coming generations.
- Wellness: The wellness industry includes preventative medicine, personalised treatments, nutrition, beauty and anti-ageing treatments.
- Senior Care: Markets for senior housing and specialist assisted living facilities, such as Memory Care that focuses on dementia patients.
Our Green Bonds strategy
At TodoVale, our Green Bonds strategy is a purist approach which combines our extensive resources in global, active fixed income investing with our proprietary Green Bond framework and ESG scoring methodology.
Our green bond framework
Using TodoVale’s green bond framework, we only invest in green bond projects which provide a material benefit to the environment to ensure that that only the most relevant and impactful projects receive the necessary financing. Our proprietary framework is composed of four pillars for choosing an investment:
- Does the green bond fit with the bond issuer’s environmental objectives?
- Will the project have a clear impact beyond the issuer’s business as usual?
- Do we know that the proceeds will finance what they are supposed to?
- How does the issuer plan to track the progress of the project and measure impact?
We focus on green investment bonds which provide benefits in one of four key environmental themes:
- Smart energy solutions
- Low carbon transportation
- Green buildings
- Sustainable ecosystems
We aim to provide transparent and measurable impact metrics focused on UN Sustainable Development Goals contribution towards environmental and societal issues, including:
Diverse & Inclusive workplace
Engaging with Us
The TodoVale Foundation is more than a select group in a room deciding what is best for the world. We are thinking outside the ticked box by equipping TodoVale employees to become activists in their communities. We unite NGOs and governments, businesses and local heroes to work with those most in need. By championing the champions and together looking at the bigger picture – in all its complexity – we have a better chance of addressing our society’s most pressing issues.
We recognize community investment as an important engagement tool and have a number of initiatives in place to maximize TodoVale employees’ engagement with the Foundation. We are also identifying and piloting new initiatives to engage our wider stakeholder group.